Coke to split North American ops into two; major exec leaves

Coca-Cola (KO) has announced a major reorganization of its Americas business that includes the departure of the head of the operations, Steve Cahillane, who was once seen as a possible successor to CEO Muhtar Kent.

Cahillane's exit leaves International boss Ahmet Bozer as the clear number two at the company, with the latter's responsibilities being extended to include Latin America.

The beverages giant also intends to split its North American unit into two units, Coca-Cola North America and Coca-Cola Refreshments. The plan is part of Coke's strategy to return to a franchise model in the U.S. whereby the company will partner with independent bottling firms. However, Coke is expected to retain control over production. (PR)

Although I have a position in KO, I am becoming somewhat concerned about that position. The company does not seem to be hitting on all cylinders any longer. Seems like management is stuck in a rut. Or perhaps a better way of putting it would be stuck on the golf course.

Adding the word "refreshments" to the name of one of the two North America divisions has me believing that division will be focused on beverages and the other will be positioned in future to be focused on snacks. just speculation of course but this seems highly probable.

If Coca Cola was doing well domestically, then I would be more inclined to embrace the split as good news. With carbonated beverages sales presently under pressure due to health concern issues, I am postulating that management is doing this as a defensive measure which would not be good for Coke.